… As paper mills struggle

By Adewale Sanyaolu

STAKEHOLDERS in the print, publishing and newspaper indus­try have raised the alarm over the dearth of pulp and paper mills in the country, warning that urgent intervention from government was needed to forestall massive job losses in the sector.

The concerned stakeholders lamented that the privatisation of the nation’s three pulp and paper mills; Nigeria Paper Mill, Jebba, Kwara State, and Iwopin Pulp and Paper Company Limited, Ogun State, both in 2006, as well as Nigeria Newsprint Manufac­turing Company(NNMC) Oku Iboku, Akwa Ibom State, in 2008,has failed to meet the ob­jectives for the exercise.

For instance, between 2006- 2009 , the economy lost about N153.05 billion to the non-per­formance of the mills, according to the Raw Materials Research and Development Council (RMRDC).

The implications in the delay of the privatised mills to com­mence operation are enormous. The delay amounts to continual dependence on importation of requisite paper products and loss of foreign exchange as well as depletion of foreign exchange reserves.

The President of the Chartered Institute of Professional Print­ers of Nigeria (CIPPON), Mr. Wahab Muhammed-Lawal, in view of the challenges confront­ing members of the association, particularly high cost of printing papers, has called on President Muhammadu Buhari to revisit the issue of pulp and paper mills privatisation.

He said the importation of printing papers; especially news­print is robbing the country of jobs, while also depleting its forex reserves.

Muhammed-Lawal said CIP­PON would offer to collaborate with the Federal Government to investigate the mode of operation and other agreements entered into during the purported privati­sation of Iwopin Pulp and Paper Mill and the two others.

‘‘Iwopin had started produc­ing papers before the so- called privatization. But the institute’s recent visit to Iwopin calls for urgent investigation. That is why we would like to be part of the investigation process in order to unravel all issues surrounding the process,’’ he said.

Commenting on the state of the newspaper industry, the Gen­eral Manager, Vanguard Media Limited, publishers of Vangaurd, Saturday Vanguard and Sun­day Vanguard titles, Mr.Gbenga Adefaye,said the newspaper industry is on the brink of col­lapse, unless urgent intervention is made by the government.

Adefaye suggested that gov­ernment should ensure that con­cession, especially in tariff are extended to newspaper houses because publishing is classified under educational materials.

Adefaye, a former President of the Nigerian Guild of Editors (NGE), lamented that access to foreign exchange has been the bane of publishers because most financiers have withdrawn their credit lifeline, leaving them with the option of sourcing forex at the parallel market rate.

Corroborating Adefaye,the Executive Secretary of the Newspaper Proprietors Associa­tion of Nigeria (NPAN), Mr.Feyi Smith, called on government to give publishing houses access to forex through the official win­dow as against the black market from where they are forced to ac­cess it.

He explained that the cost of newsprint has gone through the roof, while cost of other inputs used in the production of news­paper have gone haywire. Unfor­tunately, he said the newspaper business, unlike other sector, cannot pass the cost to consum­ers.

‘‘For instance, to produce the daily edition of a newspaper costs N500 each as against the recently increased cover price of N200, while the weekend edi­tion with more pages and colour would cost about N700 as against the current price of N250. This is just a conservative cost estimate. All we keep doing is to absorb the extra cost,’’ he said.

Both Adefaye and Smith counselled that, to cushion the ef­fect of high cost of input, govern­ment should resuscitate the CBN N250 billion intervention fund for newspaper houses and pub­lishers that was mooted under ex- President Goodluck Jonathan.

Smith said, under the loan ar­rangement, each media house was to access N150 million, but he regretted that the intervention seemed to have run into a ditch because majority of the banks, claimed ignorance of the inter­vention scheme by CBN.

Last year, he said a committee headed by the Deputy Governor of CBN, Mrs. Sarah Alade, was set up to ensure that media hous­es have a soft landing as a result of the difficulty which NPAN members are having in accessing forex.

On review of the paper mills privatization, Adefaye and Smith , however, differ. While Adefaye said he would not sup­port an entire review of the process because there was a poor reading culture in the country, which he said, could have been the reason why the companies that bought the pa­per mills have failed to bring them to utilisation.

Smith, on the other hand, said he and NPAN would support the review of the privatisation, especially any move aimed at reducing the cost of production, especially newsprint.

He said NPAN has not foreclosed plans towards re­suscitating the Oku Iboku pa­per mill, explaining that two years ago, it interfaced with the new owners of the paper mills in an effort to ensure that they come on stream, but, he noted that nothing significant came out of the initiative.

‘‘The ultimate solution is to produce newsprint locally. By so doing, jobs will be created, forex saved while the cost of production will gradually go down,’’ he stated.

In a recent publication titled ‘‘Impact of Privatisation of Primary Pulp and Paper Mills on Performance of the Pulp and Paper Sector in Nigeria’’ published by the former Di­rector General of Raw Ma­terials Research and Devel­opment Council (RMRDC), Prof. Peter Onwualu, he posited that only the new management of the Nigeria Paper Mill has done any tan­gible restructuring among the privatised companies.

The company, according to him, has been able to refurbish at least two of the machines and is producing kraft paper for the local market, stating that it has been able to fulfill the objective of reducing for­eign exchange expenditure on kraft paper production.

‘‘However, the major prob­lem of the mill is currently its total dependence on recycled pulp. The packaging manu­facturers are unwilling to use the products. It is observed that the products always col­lapse under minimum load. Thus, there is apathy towards the products of the mill. As a result, the request by NPM’s management to protect the company by increasing duty on finished papers importa­tion to 40 percent has not been realized. To increase the gains of the privatization exercise, it is necessary that a sustainable source of long fibre pulp be obtained for mixing with the recycled pulp,’’ he said.

-Sun